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A Bright Forecast for Direct Marketing

Forecasters are predicting that despite the concerns about the direction of the economy, spending for direct marketing advertising will continue to grow.

The forecast is being issued by the Direct Marketing Association in conjunction with its annual meeting, the D.M.A. 2011 Conference and Exhibition, to be held in Boston from Saturday through Thursday.

The forecast, called “The Power of Direct Marketing,” is released every other year. According to the forecast, spending for direct marketing ads –- in media like direct mail, catalogs, television, telephone marketing, Internet marketing and social networking -– will reach $163 billion this year, up 5.6 percent from $154.4 billion in 2010.

And spending will grow again next year, according to the forecast, increasing 3.4 percent from 2011 to $168.5 billion.
Those who compiled the forecast are no Pollyannas, according to Yory Wurmser, director for marketing and media insights at the association. During the stock market gyrations in August, “we put back our print run by a couple weeks,” he said, to reassess the predictions in light of economic developments.

Still, “we’re pretty confident right now,” Mr. Wurmser said, that growth in direct marketing ad spending will continue and that “direct marketing will outpace the U.S. economy as a whole.”

“If you look at the big companies in the U.S. –- Google, Facebook, Amazon, Apple -– they’re platforms for direct marketing or use direct marketing,” he added.

Indeed, much of the growth in the direct marketing ad expenditures is attributable to digital channels, Mr. Wurmser said, among them search-engine marketing, mobile marketing and marketing in social media.

Spending in traditional media continues to increase, the forecast predicts, but remains below the levels of the peak year of 2007.

Those traditional channels include direct mail, which some scorn as junk mail, and direct-response television, which includes commercials and infomercials featuring the proverbial operators who are always “standing by.”

An exception to the optimistic picture for traditional media is newspapers; spending for direct response newspaper ads is forecast to decline from $8.4 billion in 2010 to $7.3 billion in 2011 and $7 billion in 2012.